Basically, you hammer either "on dolly" using the dolly as a from to smooth a spot...
or "off Dolly" using the dolly to support and steady the thin sheet metal while hammering slight off the dolly's curvature. This method is used to move metal in relation to the spot contacting the dolly - sort of like if you were holding a piece of aluminum foil in the middle and pressing down next to where you are holding it vs. holding the foil around the edges and pressing the middle.
Note: The key to moving the sheet metal back is to start hammering where the sheet metal moved last during deformation. This usually means that you start in the section farthest away from the impact. This relieves the stress and helps the most damaged (moved) area to come back into place.
Drilling small holes can also be used to relieve stress as the metal comes back into place - especially near creases. These round holes often become ovals as work progresses.
These holes can also be used with a "pick" which you hook though these holes and pull while using your smoothing hammer around the area. This hammering allows the area being pulled to rise.
I found a couple of good auto body repair books at my local library which illustrated these techniques.
See my web site for more tips and illustrations.
When I started, my wheel well cut-out was on the tire and the top of the rear tub rail was "peaked" and I had deep creases everywhere.
You wont't believe how well I was able to push my entire rear quarter back into shape. It just takes a little knowledge of techniques and thought before raising your hammer.
Also, not too long ago, a web site was posted here pointing to a new auto body forum and help site. Maybe someone can repost this link.